Decoding Housing for All by 2022

Decoding housing for all by 2022

India’s commitment to inclusive, sustainable, and affordable development

kpmg.com/in © 2014 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Opportunity of the vision ‘Housing for all by 2022’

1 crore annual urban population USD2 trillion investment is growth expected by 2050 possibly required to achieve the vision

11 crore houses will likely 2 crore houses be required by 2022 lying vacant

70 per cent of the urban housing 78 per cent of investment in need is in the afforable segment housing gets added to the GDP

30 per cent of the housing need 1.7-2.0 lakh hectare land is likely is concentrated in just two states required to meet urban housing need

30-35 per cent of housing cost consist of fees and taxes

A demographic trend suggests that India income is less than INR2 lakh per annum. is on the verge of large scale urbanisation Our analysis also reveals that it is the urban over the next few decades. With more affordable housing that require the central than one crore population getting added and state governments’ renewed focus, as to urban areas, India’s urban population is this segment may require almost half of expected to reach about 81 crore by 2050.1 the total investments envisaged.

Housing, a basic need for humans, could The government needs to accelerate the play an important role in accommodating efforts to broad-base and significantly high urban growth in India. However, augment public-private-partnership several structural issues such as high programmes introduced in the past. In gestation period of housing projects, order to achieve this, several requisite limited and expensive capital, spiralling policies and regulations promoting land and construction cost, high fees and better coordination between housing taxes, unfavorable development norms stakeholders; delegation of power to and low affordability by Economicall urban local bodies; reduction in project Weaker Section (EWS) and Lower Income gestation period; rationalisation of fees Group (LIG) households are bottlenecks and taxes; a relook at development norms; restricting desired growth in housing stock empowerment of EWS/LIG households; in India with respect to housing demand. and steps for reduction in project cost and As per studies2 conducted by the Ministry schedule overruns need to be evaluated. of Rural Development and the Ministry of Housing and Urban Poverty Alleviation, it This study, an effort by KPMG in India is estimated that almost a quarter of Indian and NAREDCO, highlights some of the households lack adequate housing facility. key concerns and strives to provide an agenda for action for central and state The central government acknowledges governments, and ULBs to meet the the importance of housing issue in the vision of ‘Housing for all by 2022’. I would country and has launched a massive like to thank the stakeholders involved campaign that promises to provide housing in preparing this study and hope that you to all its citizens by the year 2022. As per would find this report a useful read. our estimate, the vision would require development of about 11 crore houses with investments of over USD 2 trillion. Most of the housing development may need to be done for EWS/LIG households (in both rural and urban areas) whose

Neeraj Bansal Head - Real Estate and Construction KPMG in India

1. World Urbanisation Prospects: The 2014 Revision, United Nations, Department of Economic and Social Affairs, Population Division (2014), July 2014; KPMG in India analysis 2. Report of the Technical Group on Urban Housing Shortage (2012-17), Ministry of Housing and Urban Poverty Alleviation; Working Group on Rural Housing for XII Five Year Plan, Ministry of Rural Development, 2011

© 2014 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. The real estate sector is of strategic and the introduction of Real Estate economic importance to the Indian Investments Trusts (REITs). economy, as it is the second largest employment generator after agriculture While this current wave of innovative and contributes about six per cent to energy in the sector has infused new life India’s GDP. The sector with its backward into it, there are still a number of issues and forward linkages to 250 ancillary that need focussed attention, failing which industries, has the potential to generate the real estate sector will not be able to significant employment opportunities achieve its full potential. and provide a quantum jump to the Indian economy. Accelerating the growth in the This study, a joint initiative by NAREDCO sector can help turn-around the sluggish and KPMG, showcases the steps required GDP growth witnessed in the last few to meet surplus housing and funding to the years. liquidity crunched real estate sector. We are thankful to KPMG for the necessary India would require about 11 crore housing support and guidance for preparing this units on a pan India basis by 2022 to study. achieve the vision of our Honourable Prime Minister Shri. Narendra Modi. It is imperative that to achieve this vision, we strengthen the sector by streamlining the archaic norms and procedures of urban local bodies and incentivise stakeholders.

In the last decade, there have been reforms across a wide spectrum of real estate issues such as land acquisition, regulation to protect customer interests, opening the doors to foreign investors,

Navin Raheja Sunil Mantri Chairman President NAREDCO NAREDCO

Table of contents

1. Executive summary 08

2. Vision 2022: India’s housing need by 2022 10

3. Structural issues restrict participation, investments, 14 and development of urban affordable housing

4. Agenda for action based on six themes 16 needs to be introduced

• Strategic initiatives for further impetus 16

• Make strategic investments 17

• Simplify structural and procedural framework 18

• Introduce legal and regulatory reforms 19

• Empower the consumer for greater affordability 22

• Strengthen housing program delivery 23

5. Summary of recommended reforms 26

6. Annexure 28

Housing for all by 2022 Current state of housing in India Requirements to achieve the vision by 2022 presents a dramatically different opportunities and • Housing shortage of about six crore units • By 2022, India needs to develop about 11 crore housing units requirements in front of the • Level of annual investments in the housing stakeholder sector is about USD110 to 120 billion. • Investments of more than USD2 trillion or about USD250 to 260 billion annual investment until • Average growth of 5 to 6 per cent in the annual real estate sector investments 2022 between FY08 and FY14 • Investments will need to grow at a CAGR of 12 to Housing in India varies significantly 13 per cent (unadjusted for inflation) in 2022 and can reflect the socio-economic • Prioritised rural growth resulting in uneven mix of its vast population. In the last distribution of housing development • 70 per cent of the housing needs till 2022 should decade, there has been tremendous be concentrated in nine states • Both the central and state governments are growth in the country’s housing sector, along with demographic changes, rise spending about USD5 to 6 billion annually , • Urban housing is to account for about 85 to 90 per in income, growth in the number of which is about three per cent of the current cent of the total investments; the focus should be nuclear families, and urbanisation. investments in the real estate sector, or one on affordable urban houses, which is 70 per cent per cent of its annual expenditure. of the total urban housing requirement The commitment to have housing for all by 2022 is the vision of the • About 1.7 to 2.0 lakh hectare of land is expected new government, and realising this to be required to fulfil urban housing need by dream can be a step towards building 2022. a brighter India. Before taking any action, it is critical to review the current state, identify bottlenecks, and build an Source: Report of the Technical Group on Urban Housing Shortage (2012-17), Ministry of Housing and Urban Poverty Alleviation, Rural Housing for XII effective execution strategy. Five Year Plan, Ministry of Rural Development 2011; Funding the Vision - Housing for all by 2022, KPMG in India, 2014; KPMG in India analysis

Key considerations for the central government to provide an enabling framework for housing development • Absence of an effective policy framework for • Rationalize multiple fees and taxes across project Economically Weaker Section (EWS) and Lower stages which inflates construction cost by 30 to 35 Income Group (LIG) housing, which is compounded per cent with rising land cost, spiralling construction costs, and inadequate availability and reach of micro-finance • Reassessment of development norms such as measures. low FAR/FSI, density norms, parking norms, and ground coverage, especially from the EWS housing • Long gestation period of six to eight years of housing development perspective. projects, accentuated by multiple approvals to be obtained from multiple authorities in a two to three • High urbanisation rate, coupled with high rate of year time period. migration from rural areas is stressing the limited urban infrastructure; sub-optimal usage of urban land • Inadequate long-term funding across the project life (low FAR/FSI) has resulted in raising the cost per unit cycle necessitating multiple rounds of funding for the of built-up area. same project increasing the cost of capital and time. Further, the funding is not available for acquiring of • Need to focus on urban housing; especially on land from banking sources. affordable housing as it constitutes about 70 per cent of the projected total urban housing need.

• The five to six per cent CAGR in housing investment, and transport, secondly, focus on development of witnessed over the last few years, may result in new satellite towns/cities to meet the rising urban total investment of about USD1.4 to 1.5 trillion till and rural housing needs. 2022, falling short of about USD500 to 600 billion of investments envisaged. • Lack of coordination between central and state ministries that can be countered by introducing • There is a pressing requirement of integrated regulatory reforms with a view to substantially city planning on two fronts: firstly, an extensive; increase the housing development capacity with problematic term spatial planning accounting for the respect to construction capability, labour availability, housing shortage and associated urban infrastructure construction material, and housing affordability. (roads, highways, energy, sewerage, water, waste

Agenda for action based on six themes need to be introduced

The central government aims to provide housing to all its citizens by the year 20221. As per our estimate, the vision entails development of about 11 crore housing units, including the current shortage of about 6 crore units2. The housing need is almost equally distributed in urban and rural areas in the range of 5 to 6 crore units, and primarily consists of affordable houses.

Particulars Urban Rural Total Housing need (crore units) (crore units) (crore units) concentrated in nine states Current housing shortage 1.9 4.0 5.9

Our estimates reveal that 70 per Required housing units by 2022 2.6-2.9 2.3-2.5 4.9-5.4 cent of the housing needs until 2022 would be concentrated in just Total need 4.4-4.8 6.3-6.5 10.7-11.3 nine states. These states are Uttar Pradesh, Bihar, Maharashtra, West

Source: Funding the vision — Housing for all by 2022, KPMG in India, 2014 Bengal, Madhya Pradesh, Andhra Pradesh (including Telangana), Rajasthan, Tamil Nadu, and Karnataka.

1. “Talks on with stakeholders to provide Housing for all,” Ministry of Housing and Urban Poverty Alleviation, Government of India, August 2014 2. Funding the vision — Housing for all by 2022, KPMG in India, 2014

NOTHERN REGION HILLY REGION

State Urban Rural Total State Urban Rural Total Uttar Pradesh 54 146 200 North-Eastern States 14 29 42 Madhya Pradesh 22 51 74 Uttarakhand 4 5 9 Rajasthan 21 45 66 Jammu and Kashmir 3 5 8 Delhi 30 3 33 Himachal Pradesh 1 5 6 Haryana 11 14 25 Total 22 44 65 Punjab 10 13 23 Total 148 272 421

WESTERN REGION EASTERN REGION State Urban Rural Total State Urban Rural Total Maharashtra 50 55 104 Bihar 19 69 88 Gujarat 29 21 50 West Bengal 34 42 76

Goa 2 1 3 Orissa 9 26 35 Total 81 77 157 Jharkhand 11 18 29 Chhattisgarh 8 14 22 Total 81 169 250 SOUTHERN REGION

State Urban Rural Total Andhra Pradesh 37 40 77 (including Telangana) State wise housing need by 2022 Tamil Nadu 39 18 57 Karnataka 28 21 49 Kerala 27 8 36 Total 131 87 219

Source: Report of the Technical Group on Urban Housing Shortage (2012-17), Ministry of Housing and Urban Poverty Alleviation; Working Group on Rural Housing for XII Five Year Plan, Ministry of Rural Development, 2011; Census 2011; KPMG in India analysis Note: UP — Uttar Pradesh; WB — West Bengal; AP — Andhra Pradesh; TN — Tamil Nadu; MP — Madhya Pradesh

Urban affordable housing requires urgent attention

As per our estimates, development of such large quantity of houses may require investments of over USD2 trillion. This translates to about USD250 to 260 billion annually, more than double the annual investments witnessed in FY14. About 85 to 90 per cent of the total investments would be required for developing urban housing, where development costs are high due to factors such as land prices, construction cost, fees, and taxes. Within urban housing, it is the affordable housing (houses for EWS/LIG households) which require attention on priority basis, as it alone would require about half of the total investments and 70 per cent of urban housing needs envisaged. These investments need to be complemented with additional investments of about USD1.5 trillion in urban infrastructure and commercial real estate.3 Thus, a total investment of over USD3.5 trillion may be required for urban housing and supporting infrastructure.

Though, housing deficit is much wider in rural areas compared to urban areas, it requires only a small portion of total investments envisaged till 2022, which can be meted out without much difficulty. In our view, the central government with participation from state governments, drafting a plan of delivering three crore houses in rural areas with an investment of INR3.45 lakh crore (USD58 billion) by 2022 is a good start.4

Strengthening private sector participation in urban affordable housing could help achieve the ‘housing for all by 2022’ vision

Central and several states governments in the past have undertaken steps to mitigate the urban housing deficit, largely in partnership with the private sector. These efforts have yielded notable results, which is evident from few case studies presented in the annexure of this report. While, the efforts governments (both central and state) have taken in past are commendable, they need to be accelerated to eliminate housing deficit in the country.

With the current set of housing development policies in place and assuming an annual growth in investments by about five to six per cent in the housing sector (as witnessed since FY08), the required investments may fall short by about USD500 to 600 billion. This gap in funding would likely be restricted due to several structural issues in the sector such as high gestation period of housing projects, limited and expensive liquidity, spiralling land and construction cost, high fees and taxes, unfavourable development norms, and affordability vis-à-vis housing prices for EWS/LIG households.

Mobilisation of such huge resources (funding, construction capacity, labour, technology, etc.) for mass scale affordable housing development by the central and state governments may be difficult, without participation from the private sector. The private sector, which is often better in term of managing construction risks and project delivery, should be encouraged by central and state governments, by addressing several structural issues (listed in next section).

3. Funding the vision — Housing for all by 2022, KPMG in India, 2014 4. “Nitin Gadkari’s rural development ministry to spend Rs.3.45 lakh crore to build 30 million houses by 2022”, The Economic Times website, http://articles. economictimes.indiatimes.com/2014-09-01/news/53441626_1_lakh-crore-finance-ministry-rural-development-ministry, 1 September 2014

© 2014 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Structural issues restrict participation, investments, and development of urban affordable housing

Since the beginning of the twenty more than 95 per cent of the housing first century, a slew of regulatory shortage in 2012. The development reforms such as allowing foreign of urban affordable houses has been direct investments, improving limited due to several structural access to credit by households, issues making it unfeasible business providing tax incentives on housing proposition for the private sector. loans, developing special economic Major structural issues restricting zones and thrust on infrastructure private sector participation in urban development, coupled with high affordable housing are depicted below: economic growth, have propelled private sector participation in urban housing development. However, it has largely resulted in the development of Middle Income Group (MIG) and High Income Group (HIG) houses, leading to significant shortage of EWS/LIG or affordable houses. As per the report of the Technical Group on Urban Housing Shortage,1 EWS/LIG houses constitute

Urban housing shortage 2012

Urban housing shortage largely comprises of EWS/ LIG households suggesting that affordable housing development over the last several years was not adequate.

Note: States with housing shortage less than 0.1 mn are not shown above. There are such 13 states which together have 0.46 mn housing shortage Source: Report of the technical urban group (TG-12) on urban housing shortage 2012-17, Ministry of housing and urban proverty alleviation, September 2012

1. Report of the Technical Group on Urban Housing Shortage (2012-17), Ministry of Housing and Urban Poverty Alleviation. September 2012

Factors restricting private participation in urban affordable housing development

FACTORS IMPACT

1 Slow urban • 30 per cent of the population occupies only 2.3 per cent of India’s • High urban land prices development geographical area and shortage of basic urban services such as • India is witnessing high urban population growth housing, water, sewerage, • India’s per-capita urban infrastructure spending of about USD17 in waste disposal, power, India is low against a requirement of USD100. andtransport.

2 Rigid urban • Unplanned growth of urban regions • Improper growth of cities

planning process • Master planning lacks integration of spatial planning. • Infrastructure sector growth is not integrated with housing.

3 Lengthy and • Currently, 30 to 40 approvals are required which generally takes about • Increases construction cost complex approval two to three years by 20 to 30 per cent

• According to the World Bank, ‘Doing business 2013’ report, India has • Duplicity and inefficiency one of the most cumbersome and lengthy processes. • Reduces capital churn as gestation period increases.

4 Lack of adequate • Limited funding channels for developers (especially from banks) • Limited and expensive capital tend to increase housing cost funding sources • Overdependence on households’ savings • Low access to credit by • Limited foreign funding sources consumers reduces housing • Underdeveloped equity and debt markets affordability. • Limited access to credit by EWS/LIG.

5 High cost of • Consistent inflation of key input costs • Increases housing cost making affordable housing development • Several indirect taxes such as Stamp Duty, VAT, etc. adds up in projects unviable. housing cost

• It is estimated that these taxes account for about 30 to 35 per cent of the total housing cost.

6 Restrictive • Low FAR/FSI, density norms, ground coverage, parking provision, etc. • The limited urban land is development are not seperately defined for affordable housing (especially EWS utilised inappropriately norms housing) • Inflates housing price.

• Resulted in horizontal development of housing (except in few cities).

7 Cost overrun and • Shortage of trained workforce, inefficent cost management, scope • 25 per cent of ongoing project delays creep, etc. affect the financial sustainability of housing projects housing projects are delayed

• Inadequate planning, and inadequate usage of technology tends to across India. results in project delays.

Source: Over 25 per cent housing projects delayed pan-India, NDTV Profit website, http://profit.ndtv.com/news/industries/article-over-25-per-cent-housing- projects-delayed-pan-india-ncr-worst-hit-jones-lang-lasalle-328004, October 2013; Census 2011; Managing Urbanization, Planning Commission website, http://12thplan.gov.in/forum_description.php?f=17, accessed 9 September 2014; KPMG-PMI study on project schedule and cost overruns, KPMG in India, 2012; KPMG in India analysis

Encouraging private sector THEME 1: participation in urban affordable housing development could require Strategic initiative for further impetus a coordinated effort from central and state governments. A key role of the central government in the ‘Housing A. Grant infrastructure status to the affordable housing sector for all by 2022’ vision would be that Housing development involves undertaking large scale urban infrastructure of a facilitator by creating an enabling development projects. It involves purchasing of land and developing it for the environment through: purpose of construction of houses, multi-storied buildings, and creation of physical • Introducing statutory and regulatory and social infrastructure. Hence, housing development has dramatic similarities to reforms in land acquisition, and a the infrastructure sector. real estate regulator, and review archaic regulations governing the real estate sector. Housing sector is similar to the infrastructure sector

• Streamlining clearances and Factor Infrastructure sector Housing sector approval procedures required from central government agencies such Capital intensity High High as the Ministry of Environment and Forest, and the Ministry of Civil Aviation. Gestation period At least 8 years 6 to 8 years

• Channelising higher and long- Major activity Civil construction, sewage, power Civil construction, MEP, sewage lines, term investments in the sector by lines, water pipes, roads power lines, water pipes, roads providing necessary tax and non-tax incentives. Inputs required Land, labour (skilled and unskilled), Land, labour (skilled and unskilled), cement, steel cement, steel The execution responsibility would lie with states as according to the Indian constitution, housing and urban Capital tenure Long-term investments required Long-term investments required development is a state responsibility. Source: KPMG in India analysis, 2014 States should consider the following suggestions to expedite urban affordable housing development: Granting infrastructure status to the housing sector, especially affordable housing, • Decentralise decision making by could assist in opening certain additional funding avenues in addition to direct empowering ULBs tax benefits available to the infrastructure sector. This move may help the sector attract funds from insurance companies, who are mandated to invest 15 per cent • Streamline the approval process of their funds in social and infrastructure sectors (as per the Insurance Regulatory by introducing a single-window and Development Authority regulations). It may consider qualifying affordable clearance mechanism housing projects to raise funds through tax free infrastructure bonds. • Develop PPP framework to encourage private participation B. Form a nodal agency for coordinating efforts of various stakeholders • Rationalise various indirect taxes levied on housing. The central government could explore forming a nodal agency under the Ministry of Housing and Urban Poverty Alleviation to facilitate fast track development of Some possible measures around affordable housing projects. This nodal agency could be a coordinating agency the following key themes may be amongst the private sector, consumers, lending institutions, investors, various expanded by the governments (Central housing regulatory agencies and infrastructure sector ministries, and state and state) to further encourage private governments and ULBs. sector participation and expedite affordable housing development.

This special nodal agency could act as • Regulatory approvals – PPP operation risks (construction and a facilitator in streamlining approval mechanism can help ensure timely finance). Land cost, which is anywhere procedures for housing, formulating clearances of regulatory approvals, between 20 to 60 per cent of total PPP policy, and coordinating the which can reduces the risk of cost project cost (depending on project efforts of different ministries for large and schedule overruns. location), and lack formal funding scale housing projects. It could also channels for land acquisition (both assist in directing funds towards • Improved financing — A joint pool debt and foreign equity), are major the affordable housing sector by of private and public funds may bottlenecks restricting overall housing coordinating the effort the of the be more effective and efficient in development in the country.3 National Housing Bank (NHB), Housing financing housing projects. Further, a PPP project with government and Urban Development Corporation B. Channelise long-term funding (HUDCO), banking institutions, guarantee may help secure lending housing finance companies, Foreign from institutional lenders at lower in urban housing Direct Investments (FDI) and External cost. Annual growth in housing investments Commercial Borrowings (ECB). • Improved affordability – With has slowed significantly in last couple 3 some relief on stamp duty and of years. To attract higher investments, It could be further responsible for development fees, and tie-up with the government could consider identifying the available land assets banking institutions, the affordability increasing institutional lending to with central and state governments, of houses by EWS/LIG sections the sector, introduce long-term ULBs and public sector enterprises, could be improved. housing bonds to attract households which are suitable for developing and private savings, and strengthen affordable housing. For instance, the PPP model in the domestic equity and debt markets. housing sector introduced by the Rajasthan Government has resulted Further, the government could THEME 2: in large scale development of consider allowing financing of land affordable houses (refer annexure 1 parcels by either foreign investors or Make strategic investments for details). Many other states and through institutional lending. city development authorities such The government could consider A. Promote the PPP framework as Gujarat, Delhi and Vijayawada have drafted Township Development increasing budgetary support to effectively to address major Schemes or Land Pooling Policy (type the affordable housing. At present, issues of PPP models).2 A deep analysis both centraland state governments PPP projects can play an important of these PPP policies in housing combined investments are in the range role in bridging the gap between the reveals that a PPP policy should of USD5 to 6 billion annually while housing need and supply as they can aim at aggregating land for housing the sector contribution is significantly be instrumental in attracting private development, while the private high. The taxes on property and capital sector should focus on managing transaction alone amounted to USD16 capital for financially viable affordable 3, 4 housing projects. The PPP framework billion in FY14. can be effectively used to address some issues in housing development such as land availability, approval ‘Breakup’ of funding sources in the real estate sector between FY08 delays, funding, and affordability by the and FY14 poor.

Advantages of PPP model in affordable housing:1 • Land acquisition and consolidation – As per our estimate, urban housing need would require about 1.7 to 2.0 lakh hectare of land to meet the housing need till 2022 (refer annexure 2 for details). Expedited and easier land acquisition, made possible by the public sector, could enable reduction in project lifecycle and project costs.

Source: Funding the vision - Housing for all by 2022, KPMG in India, 2014

1. Affordable Housing in India, IBEF, accessed 4 September 2014 2. Report of the Task Force on Promoting Affordable Housing, Ministry of Housing & Urban Poverty Alleviation, November 2012 3. Funding the vision — Housing for all by 2022, KPMG in India, 2014 4. State Finances, Reserve Bank of India, 2013-14; KPMG in India analysis, 2014

THEME 3: Simplify structural and procedural frameworks

A. Decentralise decision-making B. Streamline the approval and empower ULBs process by introducing single Delegation of power to ULBs could window clearance mechanism help decentralise decision making backed by technology enabling introduction of reforms The current approval mechanism in at the local level. This could help many states is a complex process, as expedite decision-making and reduce on an average a developer requires 30 lengthy procedures of introducing to 40 different approvals from central; reforms. However, despite 74th state; and ULBs. Further, multiple Amendment in the Constitution of factors add to the existing complex India, directing states to delegate process leading to uncertainties powers to ULBs, several states have and delay in building approvals. It is not taken the necessary steps. A estimated that it takes about two push to decentralise decision-making to three years to obtain necessary is required from central government approvals which increases housing which can be done by either development cost by 20 to 30 per persuasion or offering incentives to cent.5 The delay is primarily due willing states. These measures can to factors such as duplicity due to be done by using various housing and overlapping regulatory jurisdiction of urban infrastructure programmes such various authorities, lack of institutional as Rajeev Awas Yojna (RAY); Indira clarity which is open to individual Awas Yojna (IAY) and Jawaharlal Nehru interpretation, involvement of multiple National Urban Renewal Mission departments, weak allocation of (JNNURM). responsibilities and accountability, etc.

Numerous central and state level laws, rules, and regulations often results in a lengthy and cumbersome approval process

Land tilte Planning & Land Construction of buildings

• Indian registration act, 1908 • Land revenue Acts by all state • National building code, 2005 • Various state legislations. governments • Local building bye-laws. • Town and country planning Acts by all state governments • Master plans/Development plans.

NOC from central government NOC from state government Service installations

• Environment impact assesment (EIA) • Water (prevention & control of pollution) • Water connection Notifications S.O. 1533 (2006) Act, 1974, and air (prevention & control of • Sewerage connection • Ancient monuments and archaeological pollution) Act, 1981. • Gas connection sites and remains Act, 1958 • Telecom connection power/electricity • Works of defense Act, 1903 (WDA) connection. • Environment (Protection) Act, 1986 • Forest conservation Act, 1980.

Source: Report of the committee on streamlining approval procedures for real estate projects in India, January 2013

5. 57 different approvals for a real estate project hampers industry growth, The Economic Times website, http://articles.economictimes.indiatimes. com/2012-09-08/news/33696666_1_single-window-clearance-approval-process-noida-extension, 8 September 2012

Multiple factors leading to uncertainties and delay in the approval process

Source: Dhanendra Kumar, Streamlining Approval Procedures for Real Estate Projects, November 2012

Development of ‘One-stop-shop’ The density norms in India may not movement of available land parcels or ‘single window clearance’ system be adequate facilitate economical towards development of increased connecting regulatory authorities development of EWS houses. There is EWS housing. at the central, state, and ULB level, an urgent need to relook at the existing supported by a robust technology development norms, especially from platform, could help reduce the EWS housing perspective. Further, complexities and delay in approvals. additional development norms such as This single window platform could internal roads and parking space could be operated either by the state or be relooked at, and if possible, relaxed ULBs (either municipality or local for EWS housing to facilitate development authority).

Development of technology enabled single-window clearance has also FSI across prominent indian cities FSI across prominent global cities been recommended by a committee on Streamlining Approval Procedure Indian city Area Maximum FSI Country City Maximum FSI for Real Estate Projects (SAPREP) in January 2013. It is recommended that Kolkata City 3.00 Bahrain Bahrain 17 the central and state Governments Salt Lake 5.95 implement the recommendations to Rajarhat 2.50 U.S.A New york 15 expedite development of housing. Downtown Bengaluru* City 4.00 U.S.A Los Angeles 13 THEME 4: Mumbai Island City 1.33 CBD Suburbs 2.70 Introduce legal and BKC 4.00 U.S.A Chicago CBD 12 regulatory reforms China Hong Kong 12 NCR Delhi 3.50 A. Relook at building Gurgaon 1.75 U.S.A San 9 development norms Noida* 3.50 Francisco

India’s FAR/FSI norms are much lower Chennai City 3.50 Thailand Bangkok 8 compared to international cities (refer following table) resulting in horizontal *Additional 5 per cent of permissible FSI is being proposed for Noida’s Green Buildings and discussions are on for making it applicable expansion of cities, and thus limiting on other Indian cities. the scarce urban land in the cities. #In case of proximity within 150m radii from any Metro station Source: Housing: The Game Changer, Cushman & Wakefield, January 2014

B. Revise the LARR Act 2013 to remove complexities Unavailability of land, especially in increased. It is estimated that the urban areas, is a grave issue affecting acquisition of land under the new the development of housing. With method would not only increase land the clearance of theLand Acquisition acquisition cost by two to four times and Resettlement & Rehabilitation (in urban and rural region respectively), Act, 2013 (LARR Act), the complexities but it would take at least three years to in acquisition of land have further acquire land.6

Timeline for acquisition of land using the LARR Act, 2013

Social impact assessment Appraisal by expert group Preliminary notification (PN) (SIA) (EG) issued by the government

To be completed 2 months of SIA Within 12 months after R&R finalisation by the within 6 months appraisal by EG commissioner

Declaration by the collector

Within 12 months of PN Infrastructure amenities

Within 18 months of awarding Compensation Award (approval of Possession Within 3 months of awarding acquisition)

Within 12 months of In case of private transaction R&R cash component declaration where R&R is applicable, the process and timeline for Within 6 months of awarding obtaining possession of land has not been set. Source: KPMG in India analysis

The LARR Act, 2013 is expected • Marginally decreased upward • Watering down of several to have a major impact on the ceiling of compensation for Rehabilitation and Resettlement development of large scale townships acquiring land in urban areas but (R&R) provisions. and affordable housing projects. It is raised for semi-urban and rural suggested that a few provisions of areas. Under the LARR Act, two • Will not conduct Social Impact the LARR Act 2013 are trimmed to to four times the compensation Assessment (SIA), which could make it a tool to achieve the growth in (Land cost and the assets attached save one to two years time in land infrastructure and housing. to land), depending upon location acquisition (urban or rural), has to be paid to the • Urgency clause has been retained The Rajasthan state government has land owners in the Rajasthan (further details recently drafted its land acquisition bill. awaited). In the LARR Act, it was The bill is a strip down version of the • Consent from land owners is not required for PPP projects. In the removed and an urgency clause can LARR Act 2013, and it is suggested be used only if land is to be acquired that the central government considers LARR Act, consent from 70 per cent of the land owners is required, for defence purpose, emergency making relevant and appropriate arising out of natural calamities, changes to stimulate not just housing, which can be exempted in certain important projects to help ensure or any other emergency with the but the overall infrastructure growth. approval of the Parliament. Some of the major differences in the speedy execution proposed Rajasthan land acquisition bill with the LARR Act 2013 are:7 6. KPMG in India analysis 7. “Rajasthan floats a stripped version of UPA’s Land Acquisition Bill,” The Economic times website, http://articles.economictimes.indiatimes. com/2014-08-13/news/52768073_1_land-owners-new-bill-private-projects, 13 August 2014

C. Promote rental housing Rental share of urban housing stock in India has progressively A mix of rental and ownership housing declined with urbanisation is required to address affordable housing needs effectively. Rental housing is important for addressing the needs of low-income residents in the context of a rapid rise in the urban population. However, rent control policies aimed at protecting tenants have had their consequences of deterring investments in rental housing in India, causing the share of rental stock to decline from 54 per cent in 1961 to 27.5 per cent in 2011 which drove EWS/LIG households into slums. Further, the Government housing programmes promoted ownership housing and did not look at creating rental stock, a feasible first option for EWS/LIG households.8

Source: National Housing Bank; Census 2011

According to the census 2011, the urban rental housing stock in the country stands at 27.5 per cent of the total housing stock which is low compared to global standards. The ratio for India should be much higher as rapid urbanisation is resulting in migration of significant number of youth population with little income to support house ownership.

Percentage of total housing stock* Percentage of social housing stock in**

Country Housing associations Social rental Private rental Pure public sector (Limited profit/non-profit)

U.K. 20 10 54 46

Ireland 7 11 90 10

U.S.A 3 29 37 69

Australia 5 22 85 8

Canada 6 28 34 66

Austria 23 17 43 53

France 16 24 Some 90^

The Netherlands 35 12 1 99

Denmark 19 18 100^

Source: International experience in providing afforable housing, IDFC 2011 Note: Housing associations are for profit, non-profit, or limited profit organisations that build and/or manage low cost or social housing *Remainder of total housing stock is predominantly ownership **The social housing stock includes both social rental and ownership units ^Include some for-profit associations, co-operatives, moderate rent agencies, and regulated private landlords. Some associations have talent shareholders.

A new rental law which is balanced in favour of both the tenant and the land-lord could be drafted by the central government. A balanced rental law could help with the development of a formal rental market in India, and to some extent improve occupancy of the unoccupied houses estimated at about two crore.9 Further, the rental housing stock should be classified as commercial real estate to facilitate its 8. National Housing Bank; Census 2011; KPMG in India analysis listing on REITs. It could help channelise higher investments in rental properties 9. Funding the vision — Housing for all by 2022, KPMG in India, 2014 expediting housing development.

THEME 5: Empower the consumer for greater affordability

A. Empower EWS/LIG households with subsidies, lower loan interest rates, micro-financing The current annual income level deepened due to low access to credit of EWS (upto INR 1 lakh) and LIG by these segments. According to households (INR1 to 2 lakh) may not our estimates, a EWS household can be sufficient to afford a house (EWS afford a house costing up to INR4 lakh and LIG houses are generally in the and LIG households can afford houses range of INR5 to 7 lakh and INR15 to 20 priced up to INR8 lakh. lakh respectively). The issue is further

Housing sector is similar to infrastructure sector Figures in INR EWS LIG

Maximum monthly income 8,000 16,000

Maximum annual income 1,00,000 2,00,000

Maximum affordability limit (4 times the annual income) 4,00,000 8,00,000

Typical housing cost (minimun) 5,00,000- 15,00,000- 7,00,000 20,00,000

Affordability gap (minimun) 1,00,000- 7,00,000- 2,00,000 12,00,000

Source: Task Force on Promoting Affordable Housing, Ministry of Housing & Urban Poverty Alleviation; KPMG in India analysis

It is therefore essential to bridge the loans from formal establishments gap between affordability for these increase risk. It is important that households. This can be achieved micro housing finance companies are by a two-pronged strategy. First of strengthened to allow flow of credit all, the government should work to these households. Further, the towards reducing the cost of housing state governments, ULBs, banking development. institutions, and developers should work together to educate and facilitate Secondly, the government should credit flow to these households. try and plug the affordability gap by empowering households to own a house. Some suggestions in this Interest subsidy on affordable direction are: housing loan: The central government currently Increase penetration of banking provides interest subsidy of one per services: cent on INR1 lakh housing loan to LIG and EWS household borrowers. The access to credit by EWS/LIG The limit in this scheme is very low households is usually weak due to and ineffective as the minimum employment in informal sectors. Firstly, price of a EWS house is about INR5 many of these households generally do lakh. It is suggested that the loan not have proper identity proof, address amount is expanded to at least INR5 proof, and income proof making it lakh for EWS houses and INR10 difficult to access credit. Secondly, lakh for LIG houses.9 A moratorium many banking and housing finance of about 3 years in payment of companies are reluctant to lend to Equated Monthly Instalments (EMI) these households due to a perceived may also be considered to relieve risk of lending to a segment that has the EWS/LIG households from the fluctuating income and higher cost of 9. “RBI extends interest rate subsidy on home loans,” livemint website, burden of paying EMI and house rent http://www.livemint.com/Politics/F5GtP1d4D2Olmi0z1AjKSN/RBI- servicing. Lastly, low financial literacy extends-interest-rate-subsidy-on-home-loans.html, 18 September simultaneously while the housing is 2012 of these households, especially under construction. in matters of taking and repaying

B. Rationalise various fees List of direct and indirect taxes imposed on real estate and taxes development The centraland state governments, and ULBs must work together S.no Tax Percentage of property cost to incentivise affordable housing development to improve 1 Developer agreement stamp duty 5 housing affordability. A key area of consideration in affordable 2 Stamp duty on purchase of property 5 housing could be through a set of concessions related to taxes and fees. It is estimated that taxes and 3 Registration 1 fees account for about 30 to 35 per cent of housing cost.10 Reducing 4 Value added tax 1 this burden could enable developers to provide cheaper houses. Several 5 Service tax 2.6 charges such as external development charges, building plan approval fees, 6 VAT to contractor 4 land conversion charges, stamp duty, value added taxes, service tax, direct 7 Other levies such as service tax 2.6 tax benefits, etc. should be reviewed and rationalised for affordable housing development. 8 Excise and custom duty 15

Total -35

Source: KPMG in India analysis, 2014; NAREDCO - Funding the vision — Housing for all by 2022

THEME 6: Strengthen housing programme delivery

Multilayered Program Management Office (PMO) to drive the agenda for housing To effectively manage the agenda for national level; the state level PMO affordable housing, the government could coordinate housing initiatives could consider establishing a within the states and move multilayered Program Management towards effective implementation of Office (PMO) at the central level, policies, and finally the PMO at city/ state level, and at the city/district district level could help resolve the level. While the central level PMO ground level issues faced by housing could drive the overall policy making projects. and monitoring framework at a

10. National Housing Bank; Census 2011; KPMG in India analysis

PMO Functions

PMO at the centre • Formulate and review policies, standards, and guidelines on housing with focus on areas such as affordable housing. • Coordinate with the central government for implementation of polices and guidelines developed. • Centralised monitoring of government funded projects in co-ordination with state PMOs and implementing agencies. • Coordinate with different agencies for developing a fund to support the housing projects. • Identify & evaluate risks affecting the housing sector and conduct periodic review for such risks with state level PMO.

PMOs in each state • Periodically evaluate the performance of the various polices for the housing sector and report the status to the central PMO. • Support state government in formulating policy, master plan, bye-laws, etc. to support the housing. • Report to PMO at the centre on the current status of key government housing projects. • Coordinate with the state government and implement agencies to resolve issues.

PMOs in implementing • Monitor and report to the state PMO on the current status of projects. agencies (city level/ district • Provide first level of support to resolve the issues faced by housing projects. level) • Escalate issues beyond their own purview to the State PMO for solutions at the State and central level. • Coordinate with multiple projects in identifying and resolving risks at the city level. • Identify and evaluate opportunities for affordable housing projects and slum redevelopment projects in cities and with help of state PMOs initiate work on such projects.

Enhance project delivery deployment across multiple projects capabilities in a timely manner, contributing to the overall success of the projects Promoting deployment of effective and the housing mandate. Project Management techniques (by various housing development agencies, PMOs) such as project Bridge the human resource gap scheduling, project budgeting, risk to deliver ‘housing for all by management, periodic-actionable 2022’ vision and consistent project status As per the KPMG-PMI study on reporting, highlighting achievements project schedule and cost overruns, it and bottlenecks faced in the is that 92 million resources would be implementation of housing projects, required in the construction industry can help reduce the cost and by 2022. To help deliver the mandate time overruns in housing projects. of more than 11 crore houses, Effective Project management focus on training would have to be techniques could also help spearheaded by the government and effectively manage resources (labour, private sector to bridge this gap. equipment, etc.) enabling their

Source: KPMG-PMI study on project schedule and cost overruns, KPMG in India, 2012

Policy support for promoting mass housing construction technologies Improved construction technology • Provide incentives such as waive and methodologies can help execute off excise duty, value added tax, housing projects more efficiently etc. on pre-fabricated construction and in lesser time. Construction elements. techniques such as prefabricated and modular construction, and innovative • Promote active R&D in this for the construction materials can further help development and marketing of execute projects in lesser time and newer, more effective technologies, with reduced resources. More impetus materials, etc. domestically however, would have to be provided The usage of such technology could to promote the use of these initiatives. help in fastening the delivery of Some suggestions in this direction are: housing stock and meeting the housing for all vision. • Offer subsidies and waive off import duty on special construction equipments, technologies, and materials.

Reform Agency responsible Time frame

Decentralise decision making and empower ULBs State governments Medium to long-term

Streamline the approval process by introducing single-window clearance Central , State, and ULBs Short to medium-term mechanism backed by technology

Relook at building development norms ULBs Short to medium-term

Promote PPP framework effectively to address the major issues Central and state governments Continuous reform

Revise LARR Act 2013 to remove complexities Central governments Short-term

Form a nodal agency to coordinate effort of various stakeholders Central government Short-term

Empower EWS/LIG households Central with some support from Medium to long-term state and ULBs

Revise rental laws to promote rental housing stock Central Short to medium-term

Rationalise various fees and taxes Central and state Medium to long-term

Grant infrastructure Status to the affordable housing sector Central government Short-term

Channelise higher funding in housing Central government, RBI, and to Medium to long-term some extent state governments

Reduce cost and schedule overruns in housing projects Central government Short-term

Promote mass housing construction technologies Central government Short-term

Source: KPMG in India analysis Note: Short-term — 6-12 months; Medium-term — 12-18 months; long-term — above 18 months

The housing sector has tremendous 250 other ancillary industries and potential as it is a major enabler as has a huge multiplier effect on the well as contributor to the economy. economy.1 Proper nurturing of the It is among the largest contributor sector could help increase its share to the exchequer and second largest from 6 per cent in 2013 to 10 to 12 per employer. The sector also supports cent by 2022.

1. Funding the vision - Housing for all by 2022, KPMG in India, 2014

Annexure 1: Case studies on urban housing PPP models

CASE STUDY 1: Rajasthan affordable housing public-private-partnership (PPP) model

Issue: –– Commercial use of up to 10 per cent with relaxation in The state was facing housing shortage of more than 11 units ground coverage, setbacks, and parking norms –– Fast track approval within 30 days Policy level changes: –– Token stamp duty • Drafted an extensive; PPP policy for different types of development: –– Flat buy back by the State Nodal Agency (pre- determined prices INR750 per sq ft for EWS/LIG and –– Land owned by the government INR1,000 per sq ft for MIG).

–– Land owned by developer Result: –– Acquisition of land by the government • Housing units with market price of INR1,500 per sq ft –– Slum rehabilitation were offered at a cost of INR 850 per sq ft for EWS/LIG category and INR1,000 per sq ft for MIG • Key benefits extended: • Typical flat cost: EWS is INR2.4 lakh; LIG is INR3.75 lakh; –– Doubled the permissible FAR and TDR facility MIG is INR7 lakh

–– Waived off external development charges, building • The policy facilitated construction of about 2.35 lakh plan approval fees, and land conversion charges houses in 77 cities across Rajasthan, of which 2.1 lakh units were given possession by December 2013.

Source: Achieving Sustainable Growth in Reality, KPMG in India, 2011; Annual Progress Report 2013-14, Rajasthan Housing Board

CASE STUDY 2: Delhi Development Authority Land Pooling Policy

Issue:

50 per cent growth in existing infrastructure was ...where existing land policy was unable to meet the required demand

Existing infrastructure capacity - 1.5 crore people At least 50,000 acres of Restricted financial capacity of DDA to acquire land and to be developed huge land parcels to accomodate 80 lakh 2011 population - 1.7 crore Unwillingness on part of the land owners - (price & population in just 10 years Current deficit - 20 lakh not partners in development)

2021 population - 2.3 crore lack of transparancy in the acquisition process 60 lakh growth

Thus, a new participatory land policy, addressing the concerns of the authorities and land-owners, and enabling infrastructure creation was required.

The Policy: Land use distribution

• Two categories of land pooling:

–– 2 to 20 hectares

–– Above 20 hectares

• DDA retention of land (source of funding for DDA)

–– Industrial - 4 per cent of the total land

–– Residential - 0 to 10 per cent of the total land

–– Commercial - 0 to 2 per cent of the total land.

Land category >20 hectares 2-20 hectares • FAR allowed to DE:

–– Residential - 400 (density of 1,000 person/ Land returned to DE 60 per cent 48 per cent hectare) on 55 per cent of the residential area

–– Commercial and city level public/semi public- DE land development up 250.

Residential 53 per cent 43 per cent • Additional 15 per cent residential FAR (above 400 FAR) is reserved for EWS housing Commercial 5 per cent 3 per cent • DE to develop 500 EWS houses for every 10 hectare of the land pooled PSP 2 per cent 2 per cent • 50 per cent of the EWS housing to be sold to DDA at INR2,000/sq feet. Rest of the development to be undertaken by the DDA

Result expected: • Land pooling is extensively used policy in several states earlier. For of development across residential, globally. It was first adopted by instance, Maharashtra, Gujarat, commercial, public and semipublic Holland and Germany in and around Tamil Nadu, Punjab and Kerala have segments through private 1890s. The policy quickly spread followed this policy instead of the participation. Consequently, the across the globe. Land Acquisition Act to develop private sector can develop about 15 lakh new houses over the next • India has also successfully • This policy is expected to result in decade in addition to commercial implemented the land pooling more than four billion square feet real estate.

CASE STUDY 3: Gujarat housing model

• Broadly there are four initiatives include providing housing at no Townships Act, 2009. It relates in Gujarat to deal with affordable cost to the existing slum dwellers. to private developers who want housing. The first is under the For the scheme to be approved for to develop residential townships. Regulations for Rehabilitation and construction, a society of individual Private developers must purchase Redevelopment of the Slums, slum dwellers must be formed and at least 40 hectares of land (in 2010. It is aimed at rehabilitation of 75 per cent of these individuals cases where Urban Development slums. Similar to the SRA model must agree to the scheme. This Authorities exist) or 20 hectares of Mumbai, the public sector scheme is only viable where the of land (in other relevant authority does not build or finance anything, land value is very high. The scheme areas).10 per cent of the area must its only involvement is through applies to existing slums. be reserved for housing for the regulations and incentives such Economically Weaker Section. as additional FSI. The developer • The second scheme is under develops projects on a slum which the Regulations for Residential

• The third scheme is operated by 10 to 15 per cent. The goal of at nominal rates for projects under the town planning schemes, this scheme is to provide land for focussed on EWS/LIG housing. where every owner within specific the future urban development and The government has also come boundaries must provide a housing. 10 per cent of the land is out with special provisions for the certain percentage (30 to 40 per reserved for Affordable Housing. development of low cost housing, cent) of the land to government. where the owner/authorised Government pays market rate • The fourth scheme is the Urban developer is expected to provide for the land, provides the entire Land Ceiling and Regulation Act. a minimum built up area of 20sqm infrastructure, and the value of The Gujarat government has subject to a minimum carpet area the owner’s land tends to go up repealed the Urban Land Ceiling of 14 sqm to slum dwellers along subsequently as a result. This and Regulation Act and transferred with water supply, drainage, and increases the efficiency of the plot surplus land to urban local bodies electricity.

Source: Report of the Task Force on Promoting Affordable Housing, Ministry of Housing & Urban Poverty Alleviation, November 2012

Annexure 2: Land requirement for urban housing

According to KPMG estimate, about 1.7 to 2.0 lakh hectare of land is required to fulfil urban housing need by 2022. This analysis is based on a FAR/FSI of 1.5 times the land area. The actual requirement of land may decrease, if the unoccupied houses of about 94 lakh, as mentioned earlier, are occupied.

Urban housing land requirements

EWS LIG MIG HIG Total

Housing need till 2022 Crore 1.7-1.9 1.3-1.5 0.8-1.0 0.4-0.5 4.4-4.8

Super-built up area Sq ft 300 650 1,000 1,500

Land required Crore sq ft 510-570 850-980 800-1,000 600-700 2,700-3,200

Land required Hectare 47,000-53,000 78,000-90,000 74,000-93,000 55,000-64,000 250,000-300,000

FAR/FSI# X 1.5 1.5 1.5 1.5

Land required Hectare 31,000-35,000 52,000-60,000 50,000-62,000 37,000-43,000 170,000-200,000

Source: KPMG in India analysis # FAR/FSI varies in different cities according to urban infrastructure and for calculation purpose has been assumed at 1.5 times the land area.

About KPMG in India

KPMG in India, a professional services firm, is the Indian member firm of KPMG International and was established in September 1993. Our professionals leverage the global network of firms, providing detailed knowledge of local laws, regulations, markets and competition. KPMG in India provide services to over 4,500 international and national clients, in India. KPMG has offices across India in Delhi, Chandigarh, Ahmedabad, Mumbai, Pune, Chennai, Bengaluru, Kochi, Hyderabad and Kolkata. The Indian firm has access to more than 7,000 Indian and expatriate professionals, many of whom are internationally trained. We strive to provide rapid, performance-based, industry-focussed and technology-enabled services, which reflect a shared knowledge of global and local industries and our experience of the Indian business environment.

KPMG International KPMG International is a global network of firms providing Audit, Tax and Advisory services. KPMG member firms operate in 155 countries, and have 155,000 people working in member firms around the world. The KPMG Audit practice endeavours to provide robust and risk-based audit services that address member firms’ clients’ strategic priorities and business processes. KPMG’s Tax services are designed to reflect the distinct needs and objectives of each client, whether firms are dealing with the tax aspects of a cross-border acquisition or developing and helping to implement a global transfer pricing strategy. In practical terms that means, KPMG firms’ work with their clients to assist them in achieving effective tax compliance and managing tax risks, while helping to control costs. KPMG Advisory professionals provide advice and assistance to help enable companies, intermediaries and public sector bodies to mitigate risk, improve performance, and create value. KPMG firms provide a wide range of Risk Consulting, Management Consulting and Transactions & Restructuring services that can help their clients respond to immediate needs as well as put in place the strategies for the longer term.

About NAREDCO

National Real Estate Development Council (NAREDCO) formed under the aegis of the Ministry of Housing & Urban Poverty Alleviation (MHUPA), Government of India, in 1998, was established as an autonomous self-regulatory apex national body.

NAREDCO was formed with a mandate to induce transparency and ethics in real estate business, and transform the unorganised Indian real estate industry into a mature, professional, and globally competitive industry.

NAREDCO strives to be the leading advocate for developing standards for efficient, effective, and ethical real estate business practices, valued by the stakeholders and viewed crucial for success in India.

The council, that is the collective voice of real estate in India, was founded by leading public and private sector companies.

NAREDCO connects closely with various authorities, Government, Public and private, in addressing real estate issues. It is worth noting that presently, Dr. Girija Vyas, Honourable Minister of Housing and Urban Poverty Alleviation; Government of India, is its Chief Patron, who participates in various interactions with NAREDCO members. Public institutions like Housing and Urban Development Corporation (HUDCO), National Housing Bank (NHB), Delhi Development Authority (DDA), Building Material and Technology Promotion Council (BMTPC) and Hindustan Prefab Ltd., LIC Housing, and HDFC are the governing council members of NAREDCO.

NAREDCO has played a key role in formulating government policies and budgets at the level of central and state governments, besides addressing issues related to developers. Policies on affordable housing, fast tracking project approvals, regulation & development Bill, and Model Rental Control Act are some of the achievements of the association in the near past. The government gives due weightage and respects suggestions put forth by the NAREDCO, which in itself is its strength.

© 2014 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. © 2014 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. © 2014 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Decoding

KPMG in India contacts: housing for

Arvind Mahajan all by 2022 Head Infrastructure and Government Services T: +91 22 3090 1740 India’s commitment to E: [email protected] inclusive, sustainable, and Neeraj Bansal affordable development Partner and Head Real Estate and Construction T: +91 124 307 4000 E: [email protected]

Tanya Tandon Manager Markets kpmg.com/in T: +91 124 307 5452 E: [email protected] kpmg.com/in

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